13th Conference of The Parties To The UNFCCC

13^th Conference of The Parties To The UNFCCC

Bali, Indonesia

Opening Plenary Session

December 12, 2007

Statement by Robert B. Zoellick
President of the World Bank Group

Robert B. Zoellick: Your Excellency the President, Mr. Secretary-General, Mr. Executive Secretary, delegates, distinguished guests…

I want to thank the Government of Indonesia, the citizens of your country, and the people of Bali for being such gracious hosts.  This is a beautiful island, and I am delighted to be able to return.

I wanted to be with you today to emphasize the World Bank Group’s commitment to support developing countries as they combine growth with protection of the environment.  We will work with you to integrate climate action – both adaptation and mitigation – into core development strategies. 

Yesterday, a high-level meeting of the Finance and Development Ministers, hosted by Minister Sri Mulyani, reinforced this point: climate change is an economic, development, and investment challenge, not just an environmental issue.

How can the World Bank Group help?

First, by integrating adaptation and mitigation into core development work.  Climate change policies cannot be the frosting on the cake of development; they must be baked into the recipe of growth and social development.  The World Bank has already been building on synergies between climate action and development – working on energy security and efficiency, encouraging renewable energy, protecting urban air quality, helping with the management of arid lands, and assisting with adaptation of agriculture.  Now we need to help shift countries to a development paradigm based on low-carbon growth and adaptation to new risks.

Second, we can help by providing innovative and concessional financing to facilitate both public and private sector investments in low-carbon and adaptation projects.  GEF and Carbon Finance have been instrumental to increasing global benefits from environmental projects supported by the World Bank Group.  We are close to completing a successful replenishment of IDA which will be key to scaling up climate change assistance for the poorest countries without diverting ODA from other needs. 

We are working with the UK, the US, and other potential donors on large-scale concessional financing mechanisms through which the multilateral development banks can support clean technology investments and the transition to low-carbon growth paths.

Third, we will pioneer and advance new market and trading mechanisms.  The Bank has played a key role in carbon market development. Yesterday, we launched a novel Carbon Forest Partnership Facility that will pilot incentives to communities for reducing emissions from deforestation while improving rural livelihoods and safeguarding indigenous peoples.  The Kyoto Treaty did not recognize the emissions benefits of developing countries’ work to reduce deforestation.  This pilot can show the benefit of including credits for such activities in the new agreement to be negotiated.  We are also finalizing the design of a Carbon Partnership Facility that will move carbon finance from retail to wholesale – allowing purchase of emission reductions from whole sectors – such as gas flaring – rather than project-by-project.  These pilots will expand the reach of the carbon market and the tools for climate change negotiations.

Given the critical role that high-quality trading markets will need to play in addressing this challenge, I would also like the World Bank Group to examine how we can support greater liquidity and efficiency in carbon trading markets.

Fourth, recognizing the vital importance of new technologies that can generate energy while limiting the impact on climate, we are working, together with others partners, on new financing and incentives schemes to facilitate technology deployment and transfer to developing countries.

Fifth, through policy changes and through the IFC, the private sector arm of the World Bank Group, we will help create an enabling environment to tap the private sector.  We will need to draw private sector capital to this task if we are to succeed.

Sixth, we will work with developing countries to support policy research on climate change and development to help share information and tools for analyzing the impacts and developing cost-effective strategies.  We are now working with six countries – including Indonesia – on customized assessments of pathways to low-carbon growth.

Finally, if we are able to advance these six activities, we should have the experience and knowledge to play a supportive role to the UN and the negotiating partners as they develop a new climate change agreement.

Last but not least, I would like to support the Secretary General’s commitment to make the UN carbon neutral: I am proud to report that the World Bank Group is the first in the UN family to achieve this goal.

When I served with the U.S. Government, I had the privilege of guiding the U.S. team that took part in the negotiations of the 1992 Rio Framework Agreement.  Fifteen years later, our knowledge is much greater, the need for action is keenly felt, and the sophistication of the negotiations and negotiating issues is much advanced.

Speaking now for the World Bank Group, with our 185 member countries, we will back the critical work of the negotiations by helping combine development, investment, and sound policies to address climate change.

Thank you for this opportunity to be with you.